Can a director’s company be awarded contracts?

Courtesy of Christopher I. Miller

Attorneys at Goede, DeBoest & Cross respond to questions about Florida community association law. The firm represents community associations throughout Florida and focuses on condominium and homeowner association law, real estate law, civil litigation, estate planning and commercial transactions. 

Q: Our homeowner’s association recently decided to look for a new landscaping company and requested bids from various vendors. One of these companies is owned by one of our directors.  

When the potential issue was raised at the board meeting to hire the new landscaper, the director who owns the company said there wasn’t any issue as he would get the best deal for the association. The board proceeded to vote, the director abstained, and his company was awarded the contract for the association. Is this legal?  

— J.B., Bonita Springs 

A: Yes, this is legal assuming the conflicted director and association follow the proper procedure for disclosing the conflict and awarding the contract.  

https://www.tcpalm.com/story/life/columnists/2022/02/10/condo-questions-can-directors-company-awarded-contracts/6694351001/

Zubair Q Britania

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